Arizona's Home and Community-Based Services program through the Division of Developmental Disabilities served 58,000 people in 2024. That's a 30% increase from the 44,000 enrolled in 2019, driven largely by a pandemic-era program that extended paid family caregiving to parents of children under 18 with intellectual and developmental disabilities.

Now that growth is colliding with federal budget cuts. The OBBBA legislation cut $911 billion in federal Medicaid funding over 10 years, and Arizona's HCBS program is especially vulnerable because it's classified as an optional benefit under federal Medicaid law. When states face budget pressure, they cut optional benefits first.

If you're one of the 58,000 Arizona families who rely on DDD services (medical insurance, respite care, medical caregiving, supplies like wheelchairs and bed lifts, occupational and speech therapy, or housing support), here's what you need to know and do right now.

Why HCBS Is More Vulnerable Than Other Medicaid Benefits

Federal Medicaid law requires states to cover certain services: hospital care, physician visits, nursing home care, and some diagnostic services. States can't cut these mandatory benefits without losing all federal Medicaid funding.

Home and Community-Based Services, the programs that allow people with disabilities to live at home instead of in institutions, are optional. States choose to offer them, and states can reduce or eliminate them when budgets tighten.

When federal Medicaid dollars shrink, states look first at optional benefits to close the gap. HCBS programs are often the largest optional line item in a state Medicaid budget, and they serve a population with high needs but limited political power. Research shows this pattern repeats across states: when federal funding drops, HCBS is cut before mandatory hospital or nursing home coverage.

Arizona's DDD enrollment grew by 14,000 people in five years. That's 14,000 more families depending on a program that federal law allows Arizona to cut if the state decides it can't afford it.

What's Changing in Arizona Right Now

The federal cuts don't happen overnight. They roll out over 10 years, and states respond with a combination of eligibility restrictions, service reductions, and new work requirements.

Starting December 31, 2026, Arizona will require expansion adults ages 19-64 to complete 80 hours per month of approved activities to stay covered under AHCCCS. Some groups are exempt, and the details of those exemptions matter for families whose adult children with IDD are covered under expansion Medicaid.

In 2025, AHCCCS initiated emergency rulemaking for the HCBS Needs Tool, which assesses eligibility for habilitation and attendant care hours under ALTCS. This tool determines how many hours of care a person qualifies for, and changes to the assessment methodology can reduce hours without changing the law. The emergency rulemaking affects mostly children under 18, and the changes took effect before the public comment period closed.

The political environment around these cuts is tense. When Arizona lawmakers attempted to curb the family caregiver program's cost in 2025, the community response was so intense that political leaders have been reluctant to discuss the issue publicly in 2026, an election year. That silence doesn't mean the budget pressure has disappeared. It means decisions about how to manage it are being made quietly.

What DDD Services Cover and Why They Matter

Arizona's DDD program provides a range of supports that allow people with intellectual and developmental disabilities to live in their communities rather than institutions. The services include:

• Medical insurance through AHCCCS
• Caregiving, ranging from simple respite (a few hours so a parent can run errands) to complex medical care (managing feeding tubes, administering medication, monitoring seizures)
• Supplies and equipment like wheelchairs, bed lifts, adaptive furniture, and communication devices
• Therapies including occupational, speech, and physical therapy
• Housing support for adults who don't live with family

For many families, these services are not supplemental. They are the foundation of daily life. Without them, parents can't work. Adults with IDD can't live independently. Children lose access to therapies that are covered under DDD but denied by commercial insurance.

People with disabilities rely on Medicaid at higher rates than the general population because of higher health care spending and lower rates of employment. When Medicaid funding is reduced at the federal level, state programs respond by cutting the benefits that this population depends on most.

What You Can Do Now

This isn't a situation where you wait to see what happens. By the time cuts are announced, the window to influence them has closed. Here's what to do now.

Contact AHCCCS Directly

If your child or family member receives DDD services, document everything. Write down the services they receive, the hours they're approved for, the equipment they use, and the therapies they access. Keep copies of all assessments, service plans, and approval letters.

If you receive a notice about a change to your services, don't assume it's final. AHCCCS has an appeals process, and Medicaid law requires them to continue services during an appeal. Document the reason for the appeal, attach all relevant records, and file within the deadline stated in the notice.

AHCCCS main contact: 602-417-4000 or www.azahcccs.gov

Know Your Olmstead Rights

The Supreme Court's Olmstead decision requires states to provide services in the most integrated setting appropriate to each person's needs. That means states can't force people into institutions when they could be served in the community with proper supports.

If Arizona reduces DDD services to the point where your family member can no longer live at home safely, that may be an Olmstead violation. The ACLU of Arizona and the Arizona Center for Disability Law both handle Olmstead cases. Document the services being cut, the impact on your family member's ability to remain in the community, and any communication from AHCCCS or DDD about the changes.

Arizona Center for Disability Law: 602-274-6287 or www.azdisabilitylaw.org

Contact Your State Legislators

Arizona's state legislature controls the budget, and legislators respond to constituents. If you live in Arizona and your family relies on DDD services, your representatives need to hear from you.

Find your legislators at www.azleg.gov/findmylegislator. Enter your address and you'll get contact information for your state senator and two state representatives.

When you contact them, be specific:

• State your name and address (they need to know you're a constituent)
• Name the service your family member receives (DDD waiver, ALTCS, HCBS)
• Explain what would happen if that service were reduced or eliminated
• Ask them to protect DDD funding in the state budget

Legislators don't respond to general advocacy. They respond to specific stories from people in their districts.

Watch for Changes to the HCBS Needs Tool

The HCBS Needs Tool assessment determines how many hours of habilitation and attendant care a person qualifies for. Changes to the tool can reduce hours without changing the law, and those changes often happen through rulemaking rather than legislation.

AHCCCS publishes proposed rules at www.azahcccs.gov/AHCCCS/Initiatives/Rulemaking. If you see a notice about changes to ALTCS, DDD, or HCBS assessments, submit a public comment. Comment periods are usually 30 days, and agencies are required to respond to substantive comments.

Your comment doesn't need to be long. It needs to be specific: how the proposed change affects your family, what services would be at risk, and why the current level of support is necessary.

Prepare for the December 31, 2026 Work Requirement Deadline

If your adult child with IDD is covered under Arizona's Medicaid expansion (not traditional ALTCS), the December 31, 2026 work requirement deadline applies to them unless they qualify for an exemption.

AHCCCS hasn't finalized the exemption categories yet, but federal guidance allows exemptions for people who are "medically frail" or have disabilities that prevent them from meeting the work requirement. If your adult child qualifies for an exemption, you'll need documentation from their doctor or case manager stating why they can't complete 80 hours per month of approved activities.

Don't wait for AHCCCS to contact you. Request the documentation now so you have it ready when the exemption process opens.

What This Means Nationally

Arizona isn't the only state dealing with this. Every state that offers HCBS faces the same budget pressure, and every state has the same legal option to cut optional benefits before mandatory ones.

If you live outside Arizona and your family depends on Medicaid-funded home care (whether it's called a waiver, HCBS, LTSS, or ALTCS), the same vulnerability applies. Federal Medicaid cuts don't force states to cut specific programs, but they force states to make choices, and HCBS programs are the largest optional category most states can cut.

The mechanics are the same everywhere: document your services, know your Olmstead rights, contact your state legislators, and engage in the rulemaking process when your state proposes changes to eligibility or assessment tools.

The difference between families who keep services and families who lose them often comes down to who documented everything, filed appeals on time, and made their legislators understand what's at stake.

What Happens Next

Arizona's state budget process runs from January through June, and the fiscal year starts July 1. If cuts to DDD are coming, they'll be proposed during that window. The public hearings for the budget happen in the spring, and that's when advocates and families testify.

You won't hear about cuts in a press release. You'll hear about them from your case manager, or in a notice about reduced hours, or when a service you've relied on for years is suddenly unavailable.

The time to act is before that happens. Contact AHCCCS, document your current services, find your legislators, and get the medical documentation you'll need for a work requirement exemption.

The program that serves 58,000 Arizona families didn't grow by 30% because the need went away. It grew because the need was always there, and Arizona finally funded it. Federal cuts don't change the need. They only change how much money is available to meet it.